Bulgarian banks extend moratorium on loan repayments

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SOFIA, Dec.11 (Reuters) – Bulgaria’s central bank on Friday allowed commercial banks to extend a moratorium on loan repayments in a bid to help diligent borrowers hit by the coronavirus crisis.

This is the second extension of the program introduced in April, under which individuals and businesses were allowed to stop repaying their bank loans for a period of up to six months.

The central bank said earlier this month it would consider a new round of loan repayment holidays in line with guidelines from the European Banking Authority.

Borrowers will now be able to negotiate with lenders until the end of March to delay interest and principal payments by nine months.

Those who have already had six months of loan repayment leave can negotiate an additional three months.

Bulbank, the Bulgarian unit of the Unicredit group, said in a statement that it has already opened an online application process for its clients.

Bulgaria’s 18 banks had allowed businesses and individuals to defer loan payments worth 8.5 billion levs ($ 5.27 billion) to the end of October, according to central bank data.

Coronavirus infections have started to increase since October in the Balkan country of 7 million people, forcing the government to close schools, restaurants and shopping malls for three weeks until December 21.

Bulgaria recorded 3,980 new cases of coronavirus on Friday, bringing the total to 168,165 including 5,156 deaths. ($ 1 = 1.6133 leva) (Reporting by Tsvetelia Tsolova; Editing by Kirsten Donovan)

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